Understand the language
of your books.
Short answers to the terms you meet when you keep real double-entry books, read financial reports, and connect an AI assistant.
- terms
- 8
- topics
- 3
- sentence each
- 1
Chart of accounts
The chart of accounts is the organized list of every account a business uses to categorize its transactions.
Double-entry accounting
Double-entry accounting records every transaction in at least two accounts, with total debits always equal to total credits.
General ledger
The general ledger is the complete, permanent record of every posted journal entry, organized by account.
Journal entry
A journal entry is the record of a single transaction, written as one or more debit lines and one or more credit lines that sum to equal totals.
Opening Balance Equity
Opening Balance Equity is a temporary equity account used to keep the books balanced when you first enter a business's existing balances.
Void vs. delete
In a real ledger you void (reverse) a posted transaction rather than delete it, so the audit trail stays complete.
Trial balance
A trial balance lists the ending balance of every account, with total debits equal to total credits, to confirm the books balance.
Model Context Protocol (MCP)
The Model Context Protocol (MCP) is an open standard that lets AI assistants securely connect to external tools and data through a well-defined interface.